Taro to acquire Alchemee from GaldermaSUNPHARMA - 1130 Change: -15.85 (-1.38 %)
News: Taro Pharma has entered into an agreement to acquire following subsidiaries of Galderma, Galderma Holdings, Proactiv YK, The Proactiv company corporation and other assets of The Proactiv Company used in the business of developing, manufacturing, marketing, selling and distributing products sold under the Proactiv, Restorative Elements and In Defense of Skin brands (Alchemee Business). The acquisition of all companies and assets is for ~ US$90 million.
Views:Taro’s acquisition of Alchemee adds Proactiv, a leading consumer acne brand to Taro's broad portfolio of prescription and OTC dermatology products. Sales for the acquired business has declined at CAGR of 20% over FY19-21 from US$258 million to US$166 million but acquisition at 0.5x price/sales offers a reasonable valuation for entry into OTC cosmetic products in US, Japan and Canada. Proactiv has recently undergone rebranding with new launches in non-acne category and is likely to add to Taro’s key therapeutic area of Dermatological/Topical. Taro contributed 12% to consolidated sales of Sun Pharma in FY21 and is expected to grow at CAGR of 3.2% over FY21-24E to US$604 million